Stock Market Secular Trend

By: Donald_W_Dony

The secular upward trend of the world's stock markets never missed a beat due to the ongoing turmoil surrounding the U.S. President election this last month.

The benchmark world index (Dow Jones Global Index) is set to post a new all-time high later this month which continues the pattern of 11-years of higher highs and higher lows (Chart 1).

Models point to 490 as the next expected target.

One of the main drivers of the Dow Jones Global Index is the S&P 500. This index is also surging to new highs and its 11-year upward trend is not being altered by the surge in U.S. COVID-19 cases or the Biden Presidential election.

Models suggest 3750 is the next target (Chart 2)

Canada's TSX is also advancing. After several months of consolidation, the equity index is beginning to lift off of the price support level of 15,500. The long term price pattern for the TSX is not as aggressive as the S&P 500 due to the 30 percent commodity component, but the Canadian index is still forging forward. Models indicate that 17,750 is the next target.

Bottom line: In spite of a turbulent U.S. Presidential election and an escalating global coronavirus outbreak, the world equity markets are continuing to advance and show no signs of halting their 11-year upward trend. The Dow Jones Global Index is poised to mark a new all-time high in November. The S&P 500 is locked-in to rise to a new record price level and the TSX is positioned to retest the Q1 levels. There is no evidence of any price weakness in the benchmark Dow Jones Global Index, the S&P 500 or the TSX.

By Donald W. Dony, FCSI, MFTA
www.technicalspeculator.com

COPYRIGHT © 2020 Donald W. Dony
Donald W. Dony, FCSI, MFTA has been in the investment profession for over 20 years, first as a stock broker in the mid 1980's and then as the principal of D. W. Dony and Associates Inc., a financial consulting firm to present.  He is the editor and publisher of the Technical Speculator, a monthly international investment newsletter, which specializes in major world equity markets, currencies, bonds and interest rates as well as the precious metals markets.   

Donald is also an instructor for the Canadian Securities Institute (CSI). He is often called upon to design technical analysis training programs and to provide teaching to industry professionals on technical analysis at many of Canada's leading brokerage firms.  He is a respected specialist in the area of intermarket and cycle analysis and a frequent speaker at investment conferences.

Mr. Dony is a member of the Canadian Society of Technical Analysts (CSTA) and the International Federation of Technical Analysts (IFTA).

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